The elections are upon us. The following excerpts from the Oct 2004 "The
Callahan Report" describe how the outcome of the presidential election
will influence the credit union movement for years to come.
The national election looms before us. Lest anyone who is a credit union member
– or manager – believe that the outcome of the election will not
affect credit unions, think again. The next president is going to name all three
members of the NCUA board, one of which will be the chairperson. This will set
the direction of credit unions for years to come.
The NCUA board is young enough for many of us to recall each of the former
chairpersons and their administrations.
Larry Connell’s background was state and federal banking agencies; he
treated the NCUA like the agencies he came from. His main job was to effect
the transition of the NCUA from a bureau to an independent agency overseen by
Ed Callahan guided the credit union movement into deregulation, allowing it
to take flight. He understood that the movement was for the members, not organizations,
and that it offered the country the benefit of a cooperative alternative to
the for-profit sector.
Roger Jepsen’s appointment demonstrated that politics could reach deeply
into the agency. Jepsen was an Iowa senator who failed in his re-election bid
but was rewarded for his party work by being given NCUA to run. Fortunately
he had less of an agenda than anxiety over something going wrong on his watch.
In exchange for help from the federal bureaucracy in watching out for and thwarting
trouble, Jepsen let the bureaucracy have much to do with the running of the
agency for his six-year administration.
Norm D’Amours was another politician rejected by the persons of his state
but given the NCUA as a plum by reason of his party loyalty, and he did
have an agenda. He tried to wrest the reins from the credit unions, the associations
and the bureaucracy to his own personal vision of financial service providers.
He wreaked havoc on the credit union system and on individual credit unions.
Yolanda Wheat’s administration was very brief. She had less of a political
or ideological agenda than a personal one. She brought over the NCUA colleagues
from her time at the Department of Labor, seeing the NCUA as a kind of spoils
Dennis Dollar understood that credit unions could thrive if they were left
free to thrive. He kept his distance, and, indeed, under Dollar’s aura
of laissez-faire credit unions did very well under his administration.
JoAnn Johnson seems to take the tack of “First, do no harm.” It
could be worse. But not much is happening, and, as they say, “an idle
mind is the devil’s workshop.” The NCUA is becoming overstaffed;
persons have too little to do and so are concocting rules and regulations that
could cause mischief.
This is all to say that who the chairperson is does make a difference.
Supreme Court and Congress, too
That’s not all. The next president is going to have the opportunity
to shape the Supreme Court. Within the next four years there is likely to be
a new chief justice named and several new justices.
Everyone should recall that the bankers worked their suit against us all the
way to the Supreme Court and won; it took an act of Congress to get us back
Although it seems unlikely a new suit will work its way to the highest court,
the bankers have proven themselves to be eager litigators and bent on our demise.
At this moment several suits are active in the states. Who is to say one won’t
make it to the highest court – will we have friends there or enemies?
Then there is the Congress. Though removed from presidential appointments,
the legislative branch is a powerful body, which can make or break us a financial
services alternative. In the last legislative battle, bills that affected us
greatly were voted out of committee by margins of single votes.
Credit unions have had very little influence over the past 30 years in choosing
the NCUA chairperson. Shame on us for that, but it won't change unless we get
seriously involved, and at every level. Only in this way can we exercise influence
on the people who make presidential appointments.